10/26/2009
NEWS BRIEFS

The World Trade Organization opened its investigation into whether European Union tariffs on Chinese fasteners comply with international commerce rules, the Associated Press reports.

The EU reportedly waived its opportunity to delay the probe, saying it is “strongly convinced of the strength of its case.”

The probe comes weeks after WTO-brokered talks between the EU and China reportedly broke down on September 14.

China filed an official complaint with the WTO on July 31, following through on its threat to challenge the 85% duties imposed in January on screws and bolts exports. China claims the tariffs were “neither impartial nor transparent,” and that they hurt over 1,700 Chinese fastener manufacturers.

The EU adopted antidumping duties on certain fasteners from China after concluding that Chinese producers had flooded the market with fasteners at 30% to 50% below European prices.

Products involved are covered by 10 CN tariff codes, including woodscrews, drywall screws, self tapping screws, machine screws, various other small screws, mild steel and high tensile hex bolts and screws, socket screws, bolts with other heads, spring and flat washers.

In the wake of the EU tariffs, China exports of steel and copper fasteners have plunged, with export numbers showing a 45% decline in tonnage to 700,000 tons and a 43% drop in value to $1.12 billion for the first six months of 2009.

In addition to its WTO action, China has responded to the EU tariffs with its own antidumping investigation into EU carbon steel fasteners imports.

The panel investigation represents the first time China has challenged an antidumping duty at the WTO, which could dismiss the complaint or give China the right to impose higher import tariffs on some EU goods by the end of 2010.

After it’s assembled, the panel will need about six months to issue a final ruling in the case.

While the WTO can’t force countries to comply with its rulings, it can authorize commercial sanctions against nations, though such cases generally take years to resolve.

China also faces a new front in its trade dispute with the West. In September Nucor Fastener filed antidumping and countervailing duty petitions against standard fastener exports from China and Taiwan. The petitions, filed with the U.S. Department of Commerce and the U.S. ITC, allege average dumping margins of 145% for Chinese imports, and 74% for imports from Taiwan. ©2009 GlobalFastenerNews.com

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